It’s All ‘Gloom and Doom’ From the Airbnb Crowd Ever Since San Diego Coastal Neighborhoods Were Saved

by on July 20, 2018 · 14 comments

in Ocean Beach

Wouldn’t you know it. Ever since the San Diego City Council decided last Monday to regulate short term vacation rentals, it’s all “gloom and doom” from the Airbnb crowd and their sycophants.

The Council vote on July 16 was a solid 6 to 3 in favor of Councilwoman Barbara Bry’s proposal to limit short term rentals to the primary residence and an accessory unit on the same property.

The vote was very historic – as it came after a huge defeat for Mayor Faulconer’s plan which would have opened up San Diego’s coastal and beach neighborhoods to investors world-wide. Faulconer’s plan would have destroyed the community fabric of Ocean Beach, PB and what’s left of community in Mission Beach.

But for the Airbnb crowd, it’s all a disaster, the sky is literally falling on their little bubbles. Airbnb sent this statement to the media:

“Today’s vote by the San Diego City Council is an affront to thousands of responsible, hard-working San Diegans and will result in millions of dollars in lost tax revenue for the City. San Diego has been a vacation rental destination for nearly 100 years and today’s vote all but ensures activity will be forced underground and guests will choose alternative destinations.”

“… forced underground …”? Wow.

Lori Weisberg at the San Diego Union-Tribune wrote:

The effect of the action will be to curtail investor activity in the short-term rental market while also barring residents and out-of-towners from hosting short-term stays in multiple properties other than where they reside.

Weisberg is so concerned that the new policy is “… barring residents … from hosting ….” What about a shout-out for the beach communities that were saved?

For years, the city has refused to regulate short term rentals; the council tried 3 times over a 3 year period to set policy but failed (which is not necessarily a bad thing; bad policy is worse than no policy at times). City Attorney Elliot had declared short termers were illegal in San Diego’s residential neighborhoods, but strong-mayor Faulconer deliberately ordered his code enforcement people to not do anything about the absolute proliferation of these rentals at the beach.

So, the explosion resulted, as we have reported, with a conservative and “official” total of 11,350 STVRs in the city. And 45% are in only 4 areas: Mission Beach, PB, La Jolla and downtown. Half of the top 10 community planning areas which account for 75% of all San Diego city STVRs are at the beach or coast:   these are: Mission Beach (2305), Pacific Beach (1832), La Jolla (1448), Ocean Beach (683), and Point Loma (584),

So, while beach residents are celebrating this victory and breathing easier, statements by host platform companies and some media reports highlight the anguish of those investors caught in the wringer.

One of those STVR platforms, HomeAway /VRBO, said this in its PR release following the defeat of the Falconer plan:

“HomeAway is extremely disappointed in the City Council’s decision to ignore the Mayor’s compromise and effectively ban short-term rentals in the City of San Diego. This outcome will not only negatively impact the local economy but will deny many San Diegans of their private property rights.”

This whole thing with “property rights” was the issue with Councilman Sherman during the Council debate last Monday. He accused opponents of STVRs of wanting to ban property rights. HomeAway hints at taking legal action at the end of their statement:

“We plan to evaluate next steps in the coming days to determine an appropriate path forward.”

Julie Stalmer in her San Diego Reader piece about the council vote, quoted Belinda Smith, co-founder of the Short Term Rental Alliance of San Diego (advocate for vacation rentals):

 “I see today’s vote as a huge win for the hotel lobby and a huge loss for property rights.”

Stalmer listed a whole host of ways the pro-Airbnb crowd could respond and what community advocates could expect from them; they could file multiple lawsuits in efforts to block implementation of the council action. There also could be an Airbnb-funded referendum to overturn the historic vote that saved neighborhoods. Stalmer wrote:

Others expect some will find ways to work around the new rules. One University City resident said in Santa Monica, some avoid detection from code compliance by removing their vacation rental ads during the day and putting them back up at night when code enforcement is off-duty.

One resident suggested a landlord could force a long-term renter to sign a vacation host document which would evict the tenant for three to six months out of the year.

During the City Council hearing Monday, former City Attorney Jan Goldsmith spoke at length pushing STVRs, as he  had been hired by a pro-vacation rental group fueled by Airbnb and HomeAway. Not once, but twice, did Goldsmith raise the possibilities of legal actions if the council went against the Faulconer proposal (he made the veiled threat in the negative, as in ‘I’m not suggesting I will sue ….’ ; when a lawyer tells you twice she or he won’t sue you, that’s when you call your lawyer).

Lisa Halverstadt, in Voice of San Diego under a headline emphasizing the negative, reported:

Goldsmith didn’t directly threaten a lawsuit Monday but told the City Council that a decision to regulate different types of property owners differently could inspire equal protection challenges under the U.S. Constitution. He also argued the state Coastal Commission would likely view the rules unfavorably.

Yet, Halverstadt does add:

City Attorney Mara Elliott’s office has raised similar concerns but has also said that the City Council can proceed with regulations like those approved Monday if it provides justification for applying different rules to different groups.

Halverstadt focused on Jonah Mechanic –

 a Share San Diego leader whose company manages hundreds of vacation rentals in the city, said his group is weighing its options. “Share San Diego has every intention of protecting our owners’ property rights by any means necessary,” Mechanic said.

Mechanic said his group is also examining whether the City Council rules violate the Constitution’s takings clause, which mandates that the government can’t take private property without just compensation. “The city is now taking away private property rights that it allowed for in the past,” Mechanic said.

The headlines from San Diego media are so negative. Short term vacation rentals “outlawed” – what in the wild west?

Usually the CityBeat is more enlightened than this editorial by Seth Combs, where he calls short term rental opponents “NIMBYs” and basically repeats the Airbnb line – the opponents are either being paid by or being paid off by the hotel industry:

“… I can’t help but feel that all the NIMBYists who came out to speak at these council sessions are in for a rude awakening and in more ways than one.

Make no mistake; this is a huge win for those $300-plus-per-night hotels in downtown. The hotel lobby was heavily involved in this process and pretty much got everything it wanted. It doesn’t happen often, but I can’t help but agree with Councilmember Chris Cate when he told the U-T on Monday that “the Council chose a path that is not only unenforceable and subject to legal challenge, but would drive the activity underground, resulting in the loss in millions of dollars in revenue that funds public safety officers and the repairing of city streets.”

Gee, thanks Seth – thanks for mentioning the little people who live in the coastal areas being decimated by mini-hotels.

A contrast one would expect, Councilwoman Lorie Zapf – one of the sponsors of the Bry proposal that passed, made this statement after the vote:

“I wasn’t elected to serve the interests of out-of-town investors, I was elected to serve the needs of my constituents, so I am pleased to support the Mayor’s proposal with the  Bry-Zapf  amendments.

This makes the most sense for our communities. This is not the perfect solution, but I have been working on this for the last four years and the City Council must provide some relief for the residents in my district. This final plan will fund enforcement to penalize bad actors so we can preserve the quality of life in our neighborhoods.”

Did you notice the Republican supporting another Republican here? Republican Zapf who fought with Democrat Bry to reject the Republican Faulconer plan and earlier ones that favored Airbnb, now says the victory was really “to support the Mayor’s proposal with the  Bry-Zapf  amendments.”\

Even the Mayor wants to claim victory. In the city’s official press release following the vote, under the headline, “City Council Amends and Adopts Mayor Faulconer’s Compromise Proposal …” we read the Council voted to establish new regulations for STVRs (the press release used Faulconer’s attempt at twisting the language – “short-term residential occupancy (STRO) ), ” using a compromise proposal by Mayor Kevin L. Faulconer ….”

Despite all this gloom and doom from the investor-class, there really is some sunshine at the beach. As Barbara Bry said:

“This is a great day for San Diego because we passed an ordinance that will protect our precious housing stock and still allow people to do home-sharing to make ends meet,” she said minutes after the council session ended.

“This is not a ban. This allows home-sharing and this allows someone to rent out their whole house on a short term basis up to six months a year. This is the original spirit of Airbnb.”.

 

 

 

 

{ 14 comments… read them below or add one }

kh July 20, 2018 at 2:40 pm

We are hosting a bake sale this weekend to help raise money for all the commercial hosts that took a hit to their bottom line.

It’s at the Mission Beach Community Center, we also rented a cry room booth and hired a band to play tiny violins.

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Chris July 21, 2018 at 6:44 am

While this IS a major victory, don’t get too comfortable yet. We all know there will lawsuits and probably tweeks and compromises before the dust settles.

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Rufus July 22, 2018 at 5:54 am

Vacation rental supporters cry about their property rights when in reality they are crapping on the property rights of their neighbors.

With rights come responsibilities.

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sealintheSelkirks July 22, 2018 at 2:11 pm

Sputter-sputter but what about the profits and no tax revenues for you San Diego and they will probably lose a few campaign contributors on this vote because the money given was supposed to make them do what we want….

Congratulations to the residents of OB, MB, PB, La Jolla from this old OB/MB local surfer dude! I grew up on those beaches watching nearly everything worthwhile fighting for get buried under the profit motive to the detriment of these neighborhoods. Except the height limit. How that ever got passed is still shocking, and that it still exists even more so.

You all have done wonderfully! Now keep it up. Stay involved in your communities.

I am seriously impressed with this result being admittedly somewhat of a pessimist when it comes to business/political skulduggery. Reading this today made my entire week.

This compromise, and not the so-called ‘compromise’ of the mayor’s plan mentioned in the whining voice of the HomeAway rebuttal, is probably the best result one could expect given the influence and leverage that was sure to be behind the scenes in this fight to preserve the beach neighborhoods.

EXPECT the wealthy interests to dump a lot of money into cute-sounding front groups like maybe ‘San Diego Citizens for Property Rights’ or possibly ‘Beach Area Economic Freedom Forum’ and other similar ad campaigns. You need to keep up the pressure and expect subtle attacks from the side using asymmetrical warfare just like the Tobacco and Fossil Fuel corporations have always done. Sowing confusion, using trigger words to get emotional responses that short-circuit the rational part of our brains will be coming. Educate others that fall for this crap.

This fight will never be over, not really, so plan on keeping an eye on these people and their paid politicians pretty much forever.

And always, always follow the money to its source to see who really controls the strings.

sealintheSelkirks

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Eric July 22, 2018 at 5:16 pm

The laws weren’t followed or enforced before why would the new rules be enforced? They’ll be flouted and unenforced.

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Val July 23, 2018 at 10:27 am

What I want to know is, what happened to David Alvarez? With his vote on this, it showed who he really is and I am very disappointed. He will never get my vote if he decides to go for Mayor again. Sad day.

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nostalgic July 23, 2018 at 8:44 pm

Perhaps he found it not totally thought out, and weaker than the existing laws. If any news outlet reported any comments from him, I did not see them.

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Jane July 23, 2018 at 4:10 pm

Don’t residential zoning laws preclude commercial enterprises (ie, STVRs) in residential neighborhoods, thus overriding this phoney “property rights” cry?

This was a wonderful and badly needed vote to return neighborhoods to neighbors who support local schools, libraries, recreation centers, organizations, and volunteers for all charitable purposes and a clean, safe community.

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Chris July 23, 2018 at 6:53 pm

I can see both sides…..except for Mission Beach. Does anyone realize what will happen when 1500 places go up for long term rent in Mission Beach? “In my opinion”….or in the opinion of basic economics…..great supply will lower demand. Rents will drop….property values will go right along with the rents. Landlords will stop caring…nobody will be investing in Mission Beach….no more brand new places being built….get ready for fraternity beach! I’ve heard the complaints of the residents….most of them being renters. Of course if you rent, you want cheap rent. Try sacking up and paying the mortgage on the place if you have the balls. All of the investors and owners did…..hard work & sacrifice and they acquired their investment. Many owners purchased in Mission Beach based on the fact that they could vacation rent these homes….now because of the Hotel Industry and some residents with blinders on (hellooooo, don’t move to Mission Beach if you don’t want to be around tourists!!!!) these owners will not see the returns on their investments.

People that make jokes about hard working people losing money due to this should rethink their logic….don’t be jealous because someone else busted their ass working 14 hour days to make shit happen. But I digress……

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kh July 24, 2018 at 4:43 pm

You speak like the residents of MB had no consideration in this. They are precisely who got the Mayor to reverse course on carving their neighborhood out. They understand the consequences. MB may have a history of vacation rentals, but it wasn’t half of the houses in the entire community until Airbnb came to town.

What good is curb appeal or property values if there’s no community? Why not turn it into a strip of casinos while you’re at it? I bet they’d all have drought tolerant manicured yards done by professional landscape architects. Wouldn’t that be pretty.

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Michael July 24, 2018 at 12:07 pm

Chris, that’s not basic economics. The quantity supplied will increase and the demand curve will be affected, but they’re independent of one a other. Perhaps the renters realized at current pricing you would lose 10 years of payments before making any money and it would take 20 years to actually pay less on a cash basis.

The only reason there’s a market for STVRs is because hotel development (i.e. supply) is restricted leading to a black market which you participate in.

This should have been an identified risk when you invested in your real estate venture. I dont have any sympathy for your home value when you tried to open your own business and it didn’t work out. Its a business after all. Not a primary residence.

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Frank Gormlie Frank Gormlie July 25, 2018 at 11:27 am

Question: Why do rich people’s “property rights” trump the rights of a community to be a community?

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Lyle July 28, 2018 at 9:19 pm

Nor do anyones property rights trump (forgive the word choice) zoning law. Just because I own my property does not give me the right to build an unpermitted 7-foot high fence, nor to put a fourth story (exceeding 30-foot height) on my garage.

There is a plethora of laws that I must obey, even if I’m on my own property. The community plan says my area is zoned for “single-family residential”. (period)

For some reason, some owners figure their own personal situation places them outside certain laws. This seems a slippery slope for a country that thinks it is governed by the rule of law. Even those folks engaged in traditional acts of civil disobedience (intentionally breaking the law) expect to suffer the penalties.

I hate going to city council meetings, and I hate speaking at them even more, but it’s looking like I’ll have to go on 1 August, or forever regret that I didn’t do all I could.

OBW I am really glad that Councilwoman Zapf has listened to her constituents, who she represents, and voted accordingly. That is what “representation” means to me. i.e. voting for what your voters want vice voting for what the big-bucks lobbyists want.

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Doug Blackwood July 28, 2018 at 2:29 pm

What makes a community desirable is residents year-round; who are active in maintaining their neighborhoods: we care, and we vote!
Now lets call: all our reps and let them know.
November is just around the corner!

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